Since this is the beginning of a long holiday weekend, we thought we would delay our really serious blog post that we had planned (Feces!! Dookie!! Scheisse!! How Do You Define Value?) and send you something humorous.

Watch the video below to see a group of MBA students use skills learned in their Supply Chain class to point out the inefficiencies of the latest “green” bathroom remodel at Arizona State University’s WP Carey School of Business. As an added bonus, you might be able to spot some potential future recruits and leaders of our profession…Have a wonderful and especially safe holiday weekend!!

Cheers!

Dalip

Our premise for some time has been that maximizing Value – as opposed to only considering cost and total cost of ownership (TCO) – is critical to achieving a corporation’s desired business results.  Recently we decided to apply that lens to IT departments. We found that optimum business results for projects and programs are not being achieved. Part of the problem is that CIOs have been losing their seat at the table. Over the last fifteen years they have been increasingly moved within the corporate hierarchy. Many are now reporting to the CFO rather than the CEO (Computerworld).  There are several reasons for this, including overspending during the dot.com boom, overspending on Y2K remediation,  lackluster results from ERP implementations relative to the promises made, and complaints from the business that IT is too narrowly focused on their own success as opposed to corporation success.   In the CEO’s mind, this has made IT an area that requires more oversight. The watchdog for this kind of oversight is typically the CFO.

Our experience has shown that the core reason for this ratcheting down of IT’s position is due to their focusing on the wrong “What” (Cost, Time, Scope, Quality, Risk – the typical drivers of an IT project) and the wrong “When” (success declared when the project is deployed and the users trained).  It is apparent that companies are achieving better business results by focusing on a different set of “Whats”, including tracking and retaining new customers, market position, risk management, and operational advantage. They are also focusing on a new “When” by analyzing when business value is actually delivered. This requires them to focus on areas like Adoption, Execution, Implementation, Optimization and Utilization.

As evidenced by recent articles in CIO Magazine, the conversations about IT have moved past merely worrying about alignment and have morphed into programs and discussions of how best to provide business value. This makes the discussion more concrete and useful but one could argue that it hasn’t moved us much closer to solving the underlying problems of properly identifying and driving towards true value to the business.

How does it look to the rest of you? Is IT providing stronger business value?

The Seven Habits of Highly Effective People, first published in 1989, was a bestselling self-help book written by Stephen R. Covey.  The book presents an approach to goal attainment by focusing on a set of universal principles centered on fairness, honesty, integrity and human dignity.

In today’s challenging supply chain environment, being highly effective is a competitive weapon.  The Mpower Group’s experience has shown that many traditional supplier-customer relationships are not thriving and less than effective. At the heart of these relationships is the destructive belief that if someone wins, another must lose.

Tapping into a higher value dimension requires adopting a new mindset, utilizing new skills, and executing new habits.  The Mpower Group’s value approach is to shift the supplier relationship to where there are enough rewards from success to thoroughly share the spoils.

While Covey’s seven habits are meritorious, not following them inhibits greatness.   In that spirit we present Seven Habits of Highly Dangerous Suppliers:

Habit 1:  A Passive Supplier.
Passive suppliers are dangerous suppliers because they refuse to take responsibility for the supply relationship.  Supplier passivity has another risky dimension to it: being reactive vs. proactive.  Solution:  Give your supplier the reigns to assert more power in the relationship but hold them accountable for enhanced results.

Habit 2:  A Directionless Supplier.
Is your supplier everything you wanted him/her to be?  Where is this supply agreement leading?  Where should it be leading?  A supplier that lacks vision represents a dead end.  Solution:  Have suppliers share their vision of relationship success then jointly execute against that vision.

Habit 3:  Suppliers Who Do Not Put First Things First.
Do your suppliers say yes to everything?  Are they overextended?  What are their top focus items?  Are they prioritizing other customers over you?  Solution:  Jointly plan, prioritize, and execute supplier tasks based on importance rather than perceived urgency. By putting first things first, you can help organize and manage supplier resources according to the visions established with Habit 2.

Habit 4: A Narrow Focus On Win.
Dangerous suppliers have a limited view of what winning is.  They tend to focus on the individual (“I”) aspects of winning not the team (“us” or “we”) approach.  They focus on completing transactions vs. securing opportunities.  Solution:  Recast supply relationships as cooperative win-wins not competitive one-time events.

Habit 5: Answer First, Listen Later.
Dangerous suppliers listen with the intent to reply, not to understand.  Abbreviated listening leads to one-sided results where needs stay unfulfilled.  Solution:  Suppliers should be able to explain the 5W’s (Who, What, Where, When, Why) of any request made by a customer before answering.

Habit 6: Separate Efforts, Separate Processes.
Dangerous suppliers ignore partnership synergies.  They view one head as better than two and attempt to solve problems internally.  Many suppliers also refuse to volunteer to outsiders any problems facing their organization.  Solution:  Routinely force supplier-customer brainstorming on problems.

Habit 7: Lack of Sustained Investment.
Dangerous suppliers often commit too much to a supply agreement and leave little room for any on-going investment.  Sustained investment is only possible when there is an economic and emotional benefit to both parties.  Solution:  When crafting supplier arrangements, leave enough margin on the table for the supplier to be able to work with you on future investments.

For those readers who would like to free themselves from poor supplier relationships by deploying advanced behavior modification techniques contact us at info@thempowergroup.com for a no-risk evaluation.